Home Equity: The Basics, Benefits, and Possibilities

May 18, 2017 4:33:16 PM

In life, there are few sources of pride and pleasure greater than owning your own home; walking around and saying, yes, this is mine. However, the value of your home is in many ways locked up until you choose to sell it. But there is another way – home equity. Tapping into your home equity is a simple and financially secure method of accessing low-cost funds, so that you can get even more use out of your property investment while you’re still living in it.

At HUECU we offer Home Equity Loans and Lines of Credit with no application fee and no closing costs.

Learn More  Apply Now

Home equity helps you unlock the value of your home so that you can put it to good use here and now. For instance, if you need to pay for tuition for your children, a home equity loan is a great alternative to a bank loan. Firstly, because your home is an asset that you already own, your interest rates will be far lower than with a personal loan or a payment via credit card. Not only that, but any interest that you do end up paying will usually be tax deductible, making your actual borrowing costs minimal.

Many homeowners use a home equity loan to cover the cost of property improvement projects they’ve been considering for a long time. Want to convert your attic into a new bedroom? Put in a new pool? These types of home remodeling projects can be costly, but ultimately they may also add tens of thousands of dollars to your home’s resale value – making them an excellent investment, as long as you’re working with a good home equity lender that can ensure competitive interest rates and no hidden charges, pre-payment fees or closing costs.

Normally, a home equity loan will allow you to take out the equivalent of around 80% of the value of your home. If your property is worth $300,000, you should be able to access up to $240,000 to achieve your home improvement goals or fund whatever other ambition you may have – to travel, to pay for a wedding, or to go back to school. Home equity is available as both a line of credit, to be accessed as needed; or, as a lump sum loan. A home equity line of credit is useful if you want a safety net other than a credit card, whereas a home equity loan is ideal for a big purchase or a one-time project.

Tapping into your home equity can open up new possibilities; from splurging on a dream vacation to getting another degree. You can even use a home equity loan to consolidate high-interest credit card debt, reducing the amount of money you owe and doing away with the hassle of paying multiple bills every month. In the end, the choice is yours. Just be sure to work with a financial team that’s experienced in helping borrowers make the most of the equity in their home, and can offer low rates and no hidden fees.

Interested in learning more? Check out HUECU’s home equity options, and fill out a quick application if you’re ready to explore the possibilities of home equity.

Tags: Home Equity, Home Buying, Savings